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How to Know If Relocating for an Acquisition is the Right Move

Team Acquira
-  June 27, 2023
What You'll Learn:
  • The importance of considering relocation in your investment thesis as an acquisition entrepreneur.
  • Factors to consider when deciding whether to relocate, including industry preferences, geographic constraints, and family considerations.
  • The significance of a sizable investment thesis to provide ample business selection opportunities.
  • Tips for approaching relocation, such as commuting, relocating with family, and managing time between locations.

As an acquisition entrepreneur, developing a solid investment thesis is crucial for making the right business acquisition decisions. 

However, an essential part of creating a fool-proof investment thesis sometimes involves relocation. 

In this article, we will explore when you should consider relocating and the factors that should influence your decision-making process. But first, let's define what an investment thesis is.

Investment Thesis

everyone who owns or manages a business is an entrepreneur

An investment thesis is a document that describes the ideal characteristics and opportunities for a business acquisition, as they appear to you. 

It outlines the unique value the entrepreneur intends to bring to the business, the industry focus, geographical location, and target revenue. 

Essentially, your investment thesis should act as a roadmap for guiding your business acquisition decisions.

The Importance of Considering Relocation

Initially, it may seem daunting to consider relocating as an acquisition entrepreneur, given the many factors that may be in play. 

However, it's always best to be open to the idea since relocation can significantly impact your investment thesis. For example, the industry you're targeting might not have many businesses available in your current location.

Pinning your investment thesis on your current location may prevent you from acquiring the ideal business.

which is true of an entrepreneur

When considering whether or not to relocate, there are several essential factors you should keep in mind, including:

1. Geographic Constraints: As an acquisition entrepreneur, either geography or industry should constrain you, but not both. Geographic constraints might include lacking businesses in your preferred location or operating in an industry with many more businesses in other regions.

2. Industry Preferences: Your investment thesis should act as a guide to finding the ideal business to acquire. If you're targeting a specific industry, it's essential to consider whether the industry is represented in your current location or if it would be more advantageous to move to a region with more business opportunities.

3. Family Considerations: Relocation is a big decision that can impact you and your family. You need to consider your family's needs and preferences and determine whether relocating is feasible for everyone.

4. The Number of Businesses For Sale: There is a considerable difference between having ten businesses to choose from versus having a hundred businesses. The more businesses you can consider, the more likely you'll eventually find the ideal business that meets your investment thesis requirements.

Tips for Approaching Relocation

Relocating can take different forms, depending on your personal and professional preferences. Here are some approaches you could consider:

1. Commuting: If you're not ready to move your family to a new location, you could explore the option of commuting. This will require a considerable amount of effort and planning, but it may be the best decision for you and your family.

2. Relocating with Family: Relocating your family to a new location may be the best option if you want to invest in building a new network and reaping the benefits of living in a new area.

3. Splitting Time Between Locations: This option involves splitting your time between two or more locations, depending on your investment thesis requirements. It's essential to determine the viability of this approach, considering your family and any other commitments.

Acquira's Approach to Relocation

At Acquira, we've worked with many entrepreneurs who jump headfirst into this exciting realm, taking over new businesses often located far from their familiar surroundings. However, as we've found, the process can sometimes be more complex and stressful than initially anticipated, especially when it involves relocation.

Take, for example, an entrepreneur we worked with who bought a business two states away from his home. He was a family man with three young children, and the whole family was initially excited about the adventure. They planned to move to this new state, start homeschooling the kids, and build a new life in a place where they didn't know anyone.

But as they dived into this new chapter, the stress levels rose. The entrepreneur not only bought a house but decided to renovate and furnish it. I remember going with him to pick up a mattress that had been shipped to his business – just one of the many tasks added to his already full plate.

Acquiring a new business isn't just about the business itself. It's about balancing numerous roles and managing stress. In this case, the stress wasn't only felt by the entrepreneur, but also by his spouse and children.

This experience was a real-life lesson about the challenges of relocating for an acquisition. The entrepreneur struggled to balance his roles as a husband, father, and business owner. This struggle was evident when he found it hard to take calls after 3 p.m., a time he had reserved for his family.

Relocating, especially when combined with integrating a new business, can significantly increase stress levels. It's a fine balancing act, requiring a careful allocation of time and attention to both personal life and the business.

So, if you're considering stepping into the world of acquisitions, it's essential to consider the potential implications of relocation. The excitement of a new venture can sometimes be overshadowed by the added stress of moving and settling into a new area. Striking the right balance is key to a successful transition.

Conclusion

Entrepreneurship through acquisition is on the rise. Nearly half of all businesses in the United States are owned by people at or approaching retirement age, and these companies have no succession plan in place. That is an opportunity for entrepreneurs who want to buy and grow existing businesses.

Ready to start developing your investment thesis? Explore Acquira's Accelerator, a business acquisition accelerator that will teach you everything you need about business acquisition.

From finding businesses, vetting them, and closing to scaling and exiting – Acquira's Accelerator will provide the necessary tools for a successful acquisition entrepreneur. Simply fill out the form below to schedule a call with an Admissions Representative and learn how we can help you on your acquisition journey.

Key Takeaways

  • When developing your investment thesis as an acquisition entrepreneur, relocation should be a crucial component of your strategy.
  • The factors that should guide your relocation decision-making include geographic constraints, industry preferences, family considerations, and business count.
  • Choosing to relocate can take different forms – commuting, moving with family, or splitting time between locations.
  • Acquiring the ideal business often requires relocating.
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